Tourism and aviation: In desperate need of a kickstart
Richard Holmes gets to the bottom of a potential way to help the ravaged tourism and aviation industries, post-Covid-19
As the lockdown slowly eases its grip on SA’s tourism industry, all eyes are on the skies for when — and how — our local aviation industry might bounce back.
Tourism supports more than 1-million jobs, contributing about 8% to GDP. And while level 3 of SA’s lockdown has allowed for limited domestic flights, onerous restrictions on who is allowed to travel have put a lid on demand.
"Aviation and tourism are so closely aligned. You need to open aviation to kick-start the tourism industry," says Airlines Association of Southern Africa CEO Chris Zweigenthal.
According to the Board of Airline Representatives of SA (Barsa), which represents the international aviation industry in SA, the broader air transport sector — including airlines and its extended supply chain — are estimated to support about $5.2bn of SA’s GDP, with spending by foreign tourists adding a further $4.3bn to the tally. A sector supporting 70,000 direct jobs, and contributing close on R170bn, is certainly not to be ignored.
But since airlines were first grounded in late-March the industry has been gutted by the overnight collapse of revenue, with many airlines having exhausted their limited cash reserves.
"It is now critical that air travel opens," says Carla da Silva, Barsa chair and Air Mauritius regional manager for Southern Africa and Latin America.
"This sector is in dire straits and the disastrous situation has resulted in thousands of South Africans losing their livelihoods."
The larger question is not only when, or if, aviation should be opened, but rather how. And looking abroad offers a number of examples local tourism and aviation leaders are looking to emulate.
Bridge over troubled waters
Identifying "air bridges" between specific countries is a concept fast taking hold abroad. In early-June one such bridge linked Spain’s Balearic islands and Germany, allowing for thousands of German holidaymakers to visit without quarantine or screening. Iceland has opened travel to Schengen countries, with conditions, while in early-June Singapore established "fast-lanes" —with pre-departure screening and the issuing of a safe travel pass —to promote business travel to specific regions of China.
"It is important for countries to identify low-, medium-and high-risk countries," notes Da Silva. "While the industry is eager for air travel to be opened, it is important to open it up in a safe and responsible manner."
"It can’t be a free-for-all, with anyone coming in. People will already be cautious and responsible when travelling, but let’s give people a chance if they want to travel," says Tourism Business Council of SA CEO Tshifhiwa Tshivhengwa.
"But we also have to look at countries where people still have money to spend."
Make the bubble bigger
Alongside the notion of air bridges is the option of creating broader "tourism bubbles".
While Australia looks set to keep its international borders closed until 2021 — despite the growing importance of its tourism industry —Australia and New Zealand are mulling a trans-Tasman tourism bubble, which would allow relatively unrestricted travel between two neighbours that have been world leaders in containing the spread of coronavirus. Fiji and other tourism-dependent Pacific island nations are also lobbying to be included, arguing that supporting their tourism industry will be more beneficial to recovery than aid packages.
The same argument could apply in Southern Africa, with a regional tourism bubble quickly rebooting intra-African travel, a sector that is becoming increasingly important to SA’s tourism economy.
"Though Europe has always been our most important market, if you look at the past few years our strongest growth in network is on the African continent," adds Paul van den Brink, project manager of the Wesgro Air Access Project. "The African market is important for us, so there are definitely opportunities for regional business.
"Regional travel is critical to SA opening successfully," agrees Sean Kritzinger, executive chair of tour operator Giltedge Africa. "I believe there’ll be mutual pressure for all to open up borders internationally together."
Trust in the Covid response of neighbouring countries is key, however, to avoid importing a new wave of infections. Key to the success of bubbles is including countries with a similar rate of infection, and virus control. And, perhaps, a dose of trust.
"There are some regional destinations that have handled the virus very well," says Zweigenthal. "Most have relatively low Covid-19 infections, so we think we could motivate operating between regional states, and as government feels more comfortable we could open further."
"Regional travel is important, but we can do this concurrently with other markets overseas," adds Tshivhengwa. "Start regional travel earlier than September, so that we can refine the processes."
An argument against a slow, phased reopening is that without onward connectivity major airlines may not see the value in relaunching long-haul routes.
SA may fall behind
Onward connections are "a prerequisite for international carriers to resume services to SA," says Da Silva. "Failure to offer connectivity will lead to SA being bypassed, and losing its enviable leadership as an intercontinental hub."
There is also the risk that SA may get left behind in Africa’s tourism recovery, if it waits too long before relaxing rules on air travel.
With both Tanzania and Rwanda already lifting restrictions on international flights, "it’ll only be a matter of time before other countries like Kenya and Uganda do the same," says Kritzinger.
"Travellers have choices. We are not the only destination in the world people can travel to," warns Tshivhengwa.
"We need to have a date for reopening so that we can start talking to clients, start preparing, and start protecting our forward bookings."
While the government is stuck between the rock of rising infections and the hard place of a tourism economy on the ropes, international airlines whose SA services are on hold wait eagerly for a firm indication of when international borders may be opened.
"The sooner we can get clarity the better," says Van den Brink. "We know from some carriers that they want to come back as soon as SA allows them to, so that’s good news. I also think others will come back, but with less frequency. That’s what we see on the global stage as well."
And, ultimately, the market will deliver what customers demand. While the work towards airport protocols and creating international air bridges and travel bubbles is certainly a necessary step in reviving the beleaguered tourism industry, an equally important question is, simply: are we — are you? —ready to travel again.
Opportunity knocks for charter companies?
While SA’s commercial airlines have been hard-hit by the grounding of flights during the lockdown, privately owned charter operators have been nimble enough to pivot into new sectors of the aviation business.
From its base at OR Tambo International Airport, Federal Airlines has long built its business around ferrying safari tourists to the high-end lodges of the Lowveld. But when lockdown hit they quickly changed course.
“We were able to convert our Beechcraft 1900 aircraft into a freighter, and started flying freight into neighbouring countries,” explains Federal Airlines CEO Rudi van Schalkwyk. “In level 3 we also saw an increase in business charter queries, particularly from the mining industry, but we were somewhat handicapped by all the approvals needed.”
As regulations — if not our anxiety — about flying relax, charter companies are hoping that those travellers previously happy to pay for the convenience of charter flights will now embrace the healthy seclusion of private aviation.
It will certainly be an option for the wealthy few, “but can an entire industry be serviced by just a few?” asks Angel Gabriel Group CEO Dylan Coppard. “We need the full spectrum of spenders. The rich, those who are stretching budgets, and those who are splurging one-off on a special holiday.”
One solution is for charter operators to diversify their business; opening up new routes and offering a suite of services that don’t rely solely on international tourism.
“In a way the lockdown has been a good thing. You open your eyes again to the opportunities that are there. When things go well you can get into a rut, you keep on doing what you were doing,” says Van Schalkwyk. “Churchill said never waste a good crisis, and after all this there’s definitely opportunity that will knock on the door.”
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